Joel R. Glucksman
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201-896-7095 jglucksman@sh-law.comFirm Insights
Caesars Operating Request Time Extension In Bankruptcy Case
Author: Joel R. Glucksman
Date: May 15, 2015
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The operating unit of Caesars Entertainment Corp., Caesars Operating, request additional time so the company can file its own Chapter 11 reorganization plan without having to worry about rival agendas.
The branch garnered a substantial amount of attention when the group chose to file for Chapter 11 bankruptcy protection earlier in 2015.
Exclusive period ends in May
Under current bankruptcy law, Caesars Operating has an exclusive period to file a Ch. 11 plan. This “exclusive” period ends May 15th, according to The Wall Street Journal.
As of Wednesday, April 16th, Caesars Operating requests that the U.S. Bankruptcy Court in Chicago extend its exclusivity period, giving it until Nov. 15th to file its reorganization plan and up to Jan. 15th, 2016, to solicit votes on any such proposal that is filed, the media outlet reported.
In the filing, Caesars Operating emphasized the complex nature of its bankruptcy case, which involves several casinos. Currently, the company is seeking to restructure $18 billion in debt. While the firm already filed a reorganization plan, the matter has been complicated due to the existence of an independent examiner probing several transactions made before the CEO filed for bankruptcy protection.
Independent examiner
Last month, a U.S. bankruptcy judge ordered an independent examiner to investigate the aforementioned transactions after creditors claimed that Caesars Operating transferred some of its most valuable properties and casinos to the operating unit’s parent company, Reuters reported.
Caesars Operating agreed that an independent examiner was needed, but made an effort to give the individual in this position a smaller scope than what any of the company’s creditors were requesting, according to the news source.
The nature of several transactions has been disputed, including Caesars Operating flipping its interest in online gambling businesses in 2011, to the 2013 transfer of Las Vegas’ Octavius Tower and more recently, the 2014 transfers of several Las Vegas casinos.
As the independent examiner looks into these deals, most parties do not want to decide on the current proposal until the report is finished, according to The Wall Street Journal. Caesars Operating stated in their filing the current probe could last around six months.
“These cases are in their early stages and numerous outstanding contingencies could have a significant impact on the terms of the plan or a new plan proposed by the debtors,” the news source reported.
Amid all these concerns, a hearing on the matter has been scheduled for April 29th, according to The Wall Street Journal.
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